There is great news on the horizon for students borrowing Federal Direct Loans during the 2020-2021 school year! Each spring, new student loan interest rates are determined for the following school year, based on the value of the 10-year Treasury note. For loans disbursed between July 1, 2020 and June 30, 2021, the interest rates on federal Direct Loans will fall by 1.78% for undergraduates, the largest single-year change in well over 10 years. Here’s a glance at how interest rates will change from the current rates to the 2020-2021 rates: